Nearly three years after announcing a planned merger between Frontier and Spirit Airlines that eventually fell apart, the former shared it has once again tried to acquire the latter. That said, Spirit Airlines has reportedly turned down the offer and will continue with its planned bankruptcy filing.
On Wednesday, Frontier Group Holdings (the parent company of Frontier Airlines) confirmed it made a “compelling proposal” to combine with Spirit Airlines through the issuance of newly issued Frontier debt and common stock. Spirit would benefit from the merger, according to Frontier, in that its stakeholders “could participate in the upside of a stronger low-cost carrier while benefiting from the very significant synergies Frontier expects to achieve by combining the airlines' operations.”
“While we are pleased with the strong results Frontier has been able to deliver through the execution of our business strategy, we have long believed a combination with Spirit would allow us to unlock additional value creation opportunities," said Barry Biffle, CEO of Frontier. "As a combined airline, we would be positioned to offer more options and deeper savings, as well as an enhanced travel experience with more reliable service."
Frontier additionally argued that Spirit's bankruptcy court filings demonstrate that its standalone plan “will likely result in an unprofitable airline with a high debt load and limited likelihood of success.”
Hours after the proposal was confirmed, Spirit rejected the bid, according to Reuters, as it expects to emerge from bankruptcy in the first quarter of 2025. Reuters adds that Frontier’s bid to Spirit shareholders included $400 million in debt and a 19 percent stake in Frontier.
Since Frontier’s initial bid for Spirit in February 2022, Spirit received a counter-offer from JetBlue and despite a recommendation from Spirit’s board of directors that favored the merger with Frontier, the low-cost airline eventually opted for JetBlue’s proposal. In the end, however, that merger was terminated in March 2024 after a U.S. judge under the Biden Administration blocked the merger due to anti-competition concerns.
In July 2024, Spirit then announced plans to overhaul its operations—including the scrapping its “signature” open-seating policy. Spirit also introduced four new offerings, including premium selections. These moves come as part of a transformation to deliver “an even friendlier, more comfortable and cost-effective travel experience.” Spirit Airlines filed for bankruptcy in November 2024.
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